Time

You are here

IMF Optimistic About Global Recovery

The global economy is on track for a broad-based recovery and the International Monetary Fund is unlikely to change its outlook when it issues is next report.

The global economy is doing well, Maury Obstfeld, the chief economist for the IMF, said in an interview with CNBC.

The IMF’s new forecast on the world’s economy is expected in about five weeks, Obstfeld said. And while he wouldn’t divulge what that may be, he did say the organization “certainly” isn’t going to lower the number from its last projection.

In July, the IMF forecast global economic growth of 3.5% for 2017 and 2.5% for 2018.

“We see broad-based recovery. The importance is that it’s really broad-based in a way that it hasn’t been in a decade,” Obstfeld said in a “Closing Bell” interview from the sidelines of the Federal Reserve’s symposium in Jackson Hole, Wyoming, on Friday.

That doesn’t mean there won’t be concerns ahead. While there are not any immediate downside risks, there are longer-term ones, he noted.

“One risk is just continuing tepid growth. What we’re seeing now is a cyclical upswing, but potential growth remains slow,” Obstfeld said. “That brings with it political tensions which we’ve seen spilling over into protectionist rhetoric, for example.”

Earlier Friday, European Central Bank President Mario Draghi told the audience at Jackson Hole that protectionist policies pose a “serious risk” for growth in the global economy.

The comments come at a time when President Donald Trump has been scrutinizing US trade agreements around the world in a push to reduce trade deficits and boost conditions for American manufacturers.